Largest Chinese Bank Bans Bitcoin from its Accounts

Chinese banks‘ Bitcoin crackdown continues with ICBC’s prohibition of all Bitcoin-related activities using its accounts yesterday.

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Largest Chinese Bank Bans Bitcoin from its Accounts

Chinese banks‘ Bitcoin crackdown continues with ICBC’s prohibition of all Bitcoin-related activities using its accounts yesterday.

The move places ICBC, China’s largest banking corporation, in line with ten other institutions which have disallowed customers to use their accounts for the purposes of Bitcoin trading.

“Safeguards”

In a statement, ICBC commented, “Any institution or individual must not use accounts set up with our bank for the deposit and withdrawal … and transfer of funds for Bitcoin and Litecoin trading,” China Post reports.

It is rules such as these which, aside from causing significant changes in business practices for Chinese exchanges, cause Bitcoin and Litecoin-accepting businesses to reassess their services. As CoinTelegraph reported yesterday, such businesses risk being “de-banked” as a result.

Coinreport writes that “this move was done as a way to protect the public from the digital currency’s associated risks,” summarising ICBC’S more explicit wording, to “protect the property rights and interests of the public, prevent money laundering risks as well as to safeguard the status of the renminbi as the legal currency.”

Experts assume that it is this “safeguarding” of the Yuan that is the main reason behind the government’s negative attitude toward cryptocurrencies. The tight currency controls surrounding the Yuan are ripe for circumvention by Bitcoin and prevention of capital fleeing the economy could well come at any price.

“The Chinese banking system as well as Chinese officials are nervous about Bitcoin as it could potentially disrupt traditional banking, as well as make it hard to track and limit the Yuan from leaving China,” Marshall Hayner of QuickCoin told CoinTelegraph.

The People’s Bank of China also recently suspended e-payments using QR codes, a move which Hayner describes as “ridiculous” but which he thinks proves the extent to which officialdom is nervous about digital currency.

 Time will tell as businesses adjust and the dust settles as to whether the situation improves and ways around the legislation can be found.

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